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U.S. state legislatures are where the action is for placing guardrails around artificial intelligence technologies, given the lack of meaningful federal regulation. The resounding defeat in Congress of a proposed moratorium on state-level AI regulation means states are free to continue filling the gap. Several states have already enacted legislation around the use of AI. All 50 states have introduced various AI-related legislation in 2025. Four aspects of AI in particular stand out from a regulatory perspective: government use of AI, AI in health care, facial recognition and generative AI. Government use of AI The oversight and responsible use of AI are especially critical in the public sector. Predictive AIAI that performs statistical analysis to make forecastshas transformed many governmental functions, from determining social services eligibility to making recommendations on criminal justice sentencing and parole. But the widespread use of algorithmic decision-making could have major hidden costs. Potential algorithmic harms posed by AI systems used for government services include racial and gender biases. Recognizing the potential for algorithmic harms, state legislatures have introduced bills focused on public sector use of AI, with emphasis on transparency, consumer protections and recognizing risks of AI deployment. Several states have required AI developers to disclose risks posed by their systems. The Colorado Artificial Intelligence Act includes transparency and disclosure requirements for developers of AI systems involved in making consequential decisions, as well as for those who deploy them. Montanas new Right to Compute law sets requirements that AI developers adopt risk management frameworksmethods for addressing security and privacy in the development processfor AI systems involved in critical infrastructure. Some states have established bodies that provide oversight and regulatory authority, such as those specified in New Yorks SB 8755 bill. AI in health care In the first half of 2025, 34 states introduced over 250 AI-related health bills. The bills generally fall into four categories: disclosure requirements, consumer protection, insurers use of AI and clinicians use of AI. Bills about transparency define requirements for information that AI system developers and organizations that deploy the systems disclose. Consumer protection bills aim to keep AI systems from unfairly discriminating against some people, and ensure that users of the systems have a way to contest decisions made using the technology. Numerous bills in state legislatures aim to regulate the use of AI in health care, including medical devices like this electrocardiogram recorder. VCG via Getty Images Bills covering insurers provide oversight of the payers use of AI to make decisions about health care approvals and payments. And bills about clinical uses of AI regulate use of the technology in diagnosing and treating patients. Facial recognition and surveillance In the U.S., a long-standing legal doctrine that applies to privacy protection issues, including facial surveillance, is to protect individual autonomy against interference from the government. In this context, facial recognition technologies pose significant privacy challenges as well as risks from potential biases. Facial recognition software, commonly used in predictive policing and national security, has exhibited biases against people of color and consequently is often considered a threat to civil liberties. A pathbreaking study by computer scientists Joy Buolamwini and Timnit Gebru found that facial recognition software poses significant challenges for Black people and other historically disadvantaged minorities. Facial recognition software was less likely to correctly identify darker faces. Bias also creeps into the data used to train these algorithms, for example when the composition of teams that guide the development of such facial recognition software lack diversity. By the end of 2024, 15 states in the U.S. had enacted laws to limit the potential harms from facial recognition. Some elements of state-level regulations are requirements on vendors to publish bias test reports and data management practices, as well as the need for human review in the use of these technologies. Porcha Woodruff was wrongly arrested for a carjacking in 2023 based on facial recognition technology. AP Photo/Carlos Osorio Generative AI and foundation models The widespread use of generative AI has also prompted concerns from lawmakers in many states. Utahs Artificial Intelligence Policy Act requires individuals and organizations to clearly disclose when theyre using generative AI systems to interact with someone when that person asks if AI is being used, though the legislature subsequently narrowed the scope to interactions that could involve dispensing advice or collecting sensitive information. Last year, California passed AB 2013, a generative AI law that requires developers to post information on their websites about the data used to train their AI systems, including foundation models. Foundation models are any AI model that is trained on extremely large datasets and that can be adapted to a wide range of tasks without additional training. AI developers have typically not been forthcoming about the training data they use. Such legislation could help copyright owners of content used in training AI overcome the lack of transparency. Trying to fill the gap In the absence of a comprehensive federal legislative framework, states have tried to address the gap by moving forward with their own legislative efforts. While such a patchwork of laws may complicate AI developers compliance efforts, I believe that states can provide important and needed oversight on privacy, civil rights and consumer protections. Meanwhile, the Trump administration announced its AI Action Plan on July 23, 2025. The plan says The Federal government should not allow AI-related Federal funding to be directed toward states with burdensome AI regulations . . . The move could hinder state efforts to regulate AI if states have to weigh regulations that might run afoul of the administrations definition of burdensome against needed federal funding for AI. Anjana Susarla is a professor of information systems at Michigan State University. This article is republished from The Conversation under a Creative Commons license. Read the original article.
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The Trump administration has been talking to drugmakers about ways to raise prices of medicines in Europe and elsewhere in order to cut drug costs in the United States, according to a White House official and three pharmaceutical industry sources. U.S. officials told drug companies it would support their international negotiations with governments if they adopt “most favored nation” pricing under which U.S. drug costs match the lower rates offered to other wealthy countries, the White House official said. The U.S. is currently negotiating bilateral trade deals and setting tariff rates on the sector. The Trump administration has asked some companies for ideas on raising prices abroad, two of the sources said, describing multiple meetings over several months aimed at lowering U.S. prices without triggering cuts to research and development spending drugmakers insist would result. The White House official called the effort collaborative, saying both sides were seeking advice from each other. The U.S. pays more for prescription drugs than any other country, often nearly three times as much as other developed nations. President Donald Trump has repeatedly said he wants to narrow this gap to stop Americans from being “ripped off.” The previously unreported discussions reflect the challenges Trump faces to achieve that goal, and are the backdrop to the letters he sent last week to CEOs of 17 major drugmakers, urging them to cut U.S. prices to match those paid overseas. Unlike in the U.S., where market forces determine drug prices, European governments typically negotiate directly with companies to set prices for their national healthcare systems. Anna Kaltenboeck, a health economist at Verdant Research, said European nations have leverage to drive pricing and are sometimes willing to walk away from purchasing medicines they deem too expensive. Drugmakers generate most of their sales in the U.S. The Pharmaceutical Research and Manufacturers of America the industry’s main lobby group has always argued that cutting U.S. prices would stifle innovation by lowering R&D spending. PhRMA declined to comment on the private meetings. Kaltenboeck said past studies had shown that drugmakers made enough money in the U.S. to more than fund their entire global R&D spends. “Prices can come down in the United States without being increased in other countries, and we can still get innovation,” she said. TOP PRIORITY Despite the Trump administration’s tariff threats and pressure to move more manufacturing to the U.S., the push to raise European drug prices is its top priority in discussions with industry, according to a senior executive at a European drugmaker, who spoke on condition of anonymity about the confidential meetings. “This is the key conversation right now with PhRMA and every company getting that message from Pennsylvania Avenue to a point that we are already executing on it,” the executive said, referring to the White House address. The company had already met with European governments on the issue, the executive added. An E.U. Commission spokesperson said it is in regular contact with the pharma industry and pointed to an agreement with the U.S. that should it impose tariffs on pharmaceuticals, they would be capped at 15%. When asked how the administration would support international drug price negotiations, the White House official referred Reuters to Trump’s most favored nation executive order from May. That order directed trade officials to pursue trade and legal action against countries keeping drug prices below fair market value. In last week’s letters, Trump complained that since the May executive order, most industry proposals had simply shifted blame for high prices or requested policy changes that would result in billions in industry handouts. A second source, a pharmaceutical executive who was not authorized to speak on the matter, said the Trump administration has been continually meeting with representatives of his company and had discussed strategies for raising drug prices internationally. “There’s a big push from the administration to drive up prices outside the U.S.,” the executive said. The executive said the Trump administration had been looking at using trade talks with the UK and EU as leverage, and considered pressuring countries to spend a higher percentage of GDP on new medicines or offering tariff breaks in exchange for higher drug spending. It was understood that the UK deal specifically aims to get the country to ramp up investment in branded medicines over time, the executive said. A spokesperson for the UK government said it would continue to work closely with the U.S. and its own pharmaceutical industry to understand the possible impact of any changes to drug pricing, without commenting on the trade talks. In April, over 30 industry CEOs including those from AstraZeneca, Bayer and Novo Nordisk signed a letter to European Union President Ursula von der Leyen saying Europe needed to rethink its pricing policies. “It’s going to be very difficult for a country that already has the ability to control what it spends to go in the other direction,” Kaltenboeck said, “and it doesn’t make much sense for them politically.” Patrick Wingrove and Maggie Fick, Reuters
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Japanese technology conglomerate SoftBank Group Corp. posted a 421.8 billion yen ($2.9 billion) profit in the April-June quarter, rebounding from a loss a year earlier as its investments benefited from the craze for artificial intelligence. Quarterly sales at Tokyo-based SoftBank Group, which invests heavily in AI companies like Nvidia and OpenAI, rose 7% to 1.8 trillion yen ($12 billion), the company said Thursday. SoftBank’s loss in April-June 2024 was 174 billion yen. The company’s fortunes tend to fluctuate because it invests in a range of ventures through its Vision Funds, a move that carries risks. The groups founder, Masayoshi Son, has emphasized that he sees a vibrant future in AI. SoftBank has also invested in Arm Holdings and Taiwan Semiconductor Manufacturing Co. Both companies, which produce computer chips, have benefitted from the growth of AI. The era is definitely AI, and we are focused on AI, SoftBank senior executive Yoshimitsu Goto told reporters. An investment company goes through its ups and downs, but we are recently seeing steady growth. Some of SoftBank’s other investments also have paid off big. An example is Coupang, an e-commerce company known as the Amazon of South Korea, because it started out in Seoul. Coupang now operates in the U.S. and other Asian nations. Goto said preparations for an IPO for PayPay, a kind of cashless payment system, were going well. The company has already held IPOs for Chime, a U.S. neobank that provides banking services for low-credit consumers, and for Etoro, a personal investment platform. SoftBank Group stock, which has risen from a year ago, finished 1.3% higher on the Tokyo Stock Exchange after its earnings results were announced. Yuri Kageyama, AP business writer
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